Greece's debt problems still put heavy pressure on euro

Greece's debt problems still put heavy pressure on euro. 44328.jpegThe euro fell against the dollar on Friday but remained above a six-week low, finding some respite after commodities bounced off their overnight lows and as investors refocused their attention on the prospects for a further rise in euro zone interest rates.

But lingering worries about Greece's debt problems continued to weigh on the euro, which has shed roughly 5 percent from a peak near $1.4940 hit in early May, Reuters informs.

"All these countries will go bust at some stage," said Wilhelm Schroeder, a poll participant who helps manage the equivalent of about $172 million for Schroeder Equities GmbH in Munich. "I just can't see a scenario in which these countries get out of their debt problems."

The pessimism underscores how investors remain unconvinced that European policy makers can prevent the euro-area's first default even as they look to beef up Greece's 110 billion-euro rescue package ($156 billion). The cost of insuring against a Greek default reached a record this week as investors increased bets the country won't be able to make good on its borrowing, Bloomberg says.